Fair Credit Score

Your credit score is what makes or breaks your loan, mortgage and credit applications. It is the basis for whether or not you'll be able to buy that new car or put your house up. Credit scores are generated using a system by the Fair Isaac Corporation or FICO, which calculates your score and classifies it into four general categories: excellent, good, fair and poor.

Excellent scores are those of highly positive standings, ranging from 750 and up. Good credit scores are the numbers between 660 to 749. Those termed “fair” credit scores are the ones in the 620 to 659 bracket. Scores from 600 to 620 may also come under “fair,” but anything below 600 is considered to be of poor standing.

According to surveys, most Americans fall under the fair to good categories with their credit scores, the average score at 723. Those with good to excellent scores get the best rates and premiums, because they are seen as those most likely to pay on time. The fair credit scores, while they are not denied like those with poor credit scores, are given extra thought by the lenders on the status of their applications. With these cases, credit companies may refer to more than just the credit score and inquire more into the applicant's details that are seen as relevant. An example would be the applicant's length of stay in his or her current residence. While those with fair credit scores are not accepted or denied immediately, they are treated as higher-risk accounts and may have more requirements while holding back on the better deals.